EXHIBIT 10.9.1
USED VEHICLE WHOLESALE BORROWING
BASE CREDIT LINE LOAN AGREEMENT
I. THE PARTIES
This Used Vehicle Wholesale Borrowing Base Credit Line Loan Agreement (the "Loan
Agreement') is made effective the 17th day of February, 1996, by and between
GENERAL MOTORS ACCEPTANCE CORPORATION, a New York corporation with a branch
operations office located at 0000 XxXxxxx Xxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx
00000 ("GMAC") and FIRST TEAM INFINITI, LTD., a Florida limited partnership with
its principal business office located at 000 Xxxxx Xxxx Xxxxxxx Xxxx, Xxxxxxx,
Xxxxxxx 00000 ("Borrower").
II. THE RECITALS
A. WHEREAS, GMAC is in the business of providing, among other things,
various credit accommodations to motor vehicle dealers, including
Borrower, for use in the purchase, sale, lease, and rental of motor
vehicles ("Dealership Financing"); and
B. WHEREAS, Borrower has requested and GMAC is willing to provide certain
credit and finance accommodations in the form of a discretionary
revolving borrowing base line of credit to finance the Borrower's
acquisition of certain used motor vehicles (the "Line of Credit") but
only in accordance with the terms and conditions of this Loan
Agreement.
III. THE AGREEMENT
NOW, THEREFORE, in consideration of the premises and the mutual promises herein
contained, the sufficiency of which is hereby acknowledged, GMAC and Borrower
hereby agree as follows:
1. THE LINE OF CREDIT. Subject to all of the terms and conditions of
this Loan Agreement, GMAC hereby establishes an initial discretionary
revolving line of credit, not to exceed Five Hundred Thousand and
no/100 Dollars ($500,000.00) (the "Line of Credit").
(a) THE PURPOSE. The Line of Credit shall be used by the
Borrower to finance the direct acquisition and holding of Used
Motor Vehicles [as that term is defined in subparagraph
1(g)(ii)] in inventory for subsequent sale or
lease. Borrower acknowledges that the fundamental nature and
character of the Line of Credit is a purchase money loan in
that the existence and use of the credit accommodations will
enable and facilitate the acquisition of Used Motor Vehicles
as inventory for Borrower.
(b) ADVANCES. Upon request made to GMAC by Borrower from time
to time, GMAC will loan and advance money directly to Borrower
or its designee under the Line of Credit ("Advance"). Such
request shall be in writing and presented to GMAC
substantially in the form of Exhibit 1(b) hereto with the
appropriate insertions (the "Request for Credit Line
Advance"). The first Advance made on or after the date of this
Loan Agreement shall be in an amount and shall be so used to
fully pay the total principal amount presently outstanding
under the used vehicle floorplan financing accommodations now
extant between Borrower and GMAC. The aggregate principal
amount of all Advances remaining unpaid from time to time are
deemed "Credit Line Advances."
(c) LIMITATION. Credit Line Advances shall at no time and in
no event exceed the lesser of Five Hundred Thousand and no/100
Dollars ($500,000.00) or the Collateral Formula Amount, as
that term is defined in subparagraph 1(g)(i); provided,
however, that if it does for any reason, the excess amount
shall be deemed to be part of the Line of Credit for all
intents and purposes under this Loan Agreement.
(d) ACCOUNT STATED. Each Advance shall be charged to the
Borrower's account on GMAC's books and records. GMAC will
render to Borrower a statement at least once each month of the
Borrower's account which, in the absence of manifest error,
shall constitute an account stated and shall be deemed to be
correct and accepted by and binding upon Borrower and
constitute conclusive evidence as to the existence and amounts
of the Credit Line Advances, unless GMAC receives a written
statement of the Borrower's exceptions thereto within ten (10)
days after such statement is rendered to the Borrower.
(e) PRINCIPAL REPAYMENT. In addition to the other amounts
Borrower is obligated to pay GMAC as herein set forth,
Borrower shall promptly and forthwith repay to GMAC the Credit
Line Advances, as follows:
(i) PERMISSIVE PREPAYMENT. The Credit Line Advances
may be prepaid in whole or in part at the option of
Borrower and without premium or penalty, provided,
however, that any partial prepayment shall be in
multiple amounts of ten thousand dollars.
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(ii) MANDATORY REPAYMENT OF CREDIT LINE ADVANCES.
[A] So much of the Credit Line Advances must
be paid from time to time to ensure the Line of
Credit limitation of paragraph 1(c) is not exceeded.
[B] The full amount of the Credit Line
Advances must be paid immediately upon demand by
GMAC.
(f) INTEREST. The Credit Line Advances shall bear interest on
the principal amount of and from the date of each Advance to
the date of repayment in full of the Credit Line Advances.
Only one interest rate will apply to the Credit Line Advances
at any given time. The interest rate on each Credit Advance
will be determined from time to time at the Prime Rate plus
one percent per annum. The "Prime Rate" shall mean the rate of
interest publicly announced as being in effect from time to
time by a majority of the twelve (12) largest commercial banks
operating in the United States (the "Banks") as the "prime" or
"base" rate for computing interest on loans for borrowers of
the highest credit standing. In determining the Prime Rate
hereunder, GMAC's determination of the Banks and their
publicly announced prime or base rates shall be conclusive. No
change will be made in the Prime Rate unless there is a single
rate of interest which is publicly announced by at least seven
of the Banks as their prime or base rate. The Prime Rate as of
the date of this Agreement is Nine percent (9%).
Notwithstanding the foregoing, for the purposes of determining
the Prime Rate of Interest under this Loan Agreement, the
Prime Rate shall be considered to be five percent (5%) if the
Prime Rate established by said Banks at any time is a figure
which is less than 5% per annum. Interest shall be calculated
on the basis of a 360-day year for the number of actual days
outstanding. Interest shall be billed by GMAC monthly and
shall be due and payable immediately upon receipt. The parties
hereto intend to comply with applicable usury laws and the
aforesaid interest rate is to be construed in accordance with
this intent. The parties acknowledge that these laws may
change from time to time. If acceleration or other events
cause the interest contracted for, charged or received to be
in excess of the lawful maximum, Borrower will receive credits
so that the interest will comply with the law and in no event
will the interest contracted for, charged or received exceed
the legal maximum.
(g) SPECIAL DEFINITIONS.
(i) COLLATERAL FORMULA AMOUNT. The Collateral Formula
Amount shall be the aggregate of the following amounts, as
hereinafter described, as of the date of this Loan
Agreement, as
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adjusted from time to time, and as certified in the
Certification Report required to be submitted to GMAC by
Borrower pursuant to paragraph 4 hereof, provided that the
actual Collateral Formula Amount shall at no time be less
than (i) the amount represented in the Monthly
Certification Report or (ii) the Credit Line Advances,
whichever is less:
[A] With respect to all Used Motor Vehicles
owned by Borrower, Fifty percent (50%) of the lesser
of (I) the actual and reasonable acquisition cost
(plus actual and reasonable reconditioning
expenditures) or (II) the current listed wholesale
value as provided in the current, local edition of
the National Automobile Dealers Association used car
guide using average condition and making no allowance
for special or additional equipment or features.
(ii) "Used Motor Vehicles" shall mean any
and all motor vehicles, cars, vans, passenger vehicles, and
light trucks which
[A] are then owned and held in inventory for
sale, lease, or rental by Borrower; and
[B] have been owned and held in inventory
for not more than ninety (90) days from original
acquisition by Borrower; and
[C] have been previously used and titled
under any state title certificate law (except if such
use and titling was for the exclusive purpose of
utilizing it as a demonstrator in promoting the sale,
lease, or rental of Borrower merchandise); and
[D] were originally acquired by Borrower,
exclusive of reconditioning expenditures, for not
less than Three Thousand Dollars ($3,000.00) per
motor vehicle; and
[E] are of any make, type, model, or age;
and
[F] are not otherwise customarily regarded
by GMAC in the ordinary course of its business as a
new motor vehicle; and
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[G] are free from any other lien, security
interest, or encumbrance, except in favor of GMAC in
connection with this Loan Agreement; and
[H] include all parts, accessories,
instruments, or equipment originally installed
thereon.
2. SECURITY INTEREST AND COLLATERAL ASSIGNMENT. To secure (i) the
prompt and complete payment of the Credit Line Advances, (ii) the
payment and performance of any and all obligations and duties of
Borrower of any and all other debts, obligations or duties of Borrower
to GMAC now existing or hereafter arising by this Loan Agreement,
whether direct or indirect, absolute or contingent, or otherwise,
Borrower hereby pledges, assigns and grants to GMAC a security interest
in all inventory of motor vehicles meeting each of the conditions
described in subparagraphs 1(g)(ii)[A], [C], [E], and [H], including
but not limited to all Used Motor Vehicles, now existing or hereafter
acquired and wherever located, and any and all proceeds thereof, in
whatever form (the "Collateral"). Borrower shall execute and deliver to
GMAC one or more agreements, documents, and financing statements, in
form and substance satisfactory to GMAC, as may be required by GMAC to
grant and maintain a valid, perfected first lien or security interest
in the Collateral.
3. HANDLING OF COLLATERAL. With respect to the Collateral, Borrower shall:
(a) maintain, secure and protect it from diminution in value;
and
(b) keep it free and clear of the claims, liens, mortgage,
pledge, encumbrances, security interests and rights of all
others; and
(c) hold, control and dispose of the Used Motor Vehicles only
for the purpose of storing and exhibiting it for retail sale
or lease in the ordinary course of business; and
(d) permit GMAC full and complete access to it in order to
inventory, inspect and audit it, including review of
Borrower's books and records pertaining thereto; and
(e) insure it against all risks in such amounts and with a
carrier and deductibles acceptable to GMAC. Such insurance
policy shall name GMAC as loss payee, to the extent of its
interests therein and shall contain a cancellation provision
only upon thirty (30) days' prior written notice to GMAC; and
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(f) will have good and marketable title to all of it.
4. MONTHLY CERTIFICATION REPORTS. Borrower shall furnish GMAC within
fifteen (15) days of the fifteenth and last day of each month a report
certified by the chief executive officer or the chief financial officer
of Borrower, in the form attached as Exhibit 4, detailing the
Collateral Formula Amount as of the reporting date ("Monthly
Certification Report"). The Monthly Certification Report submitted as
of a month-end date shall have attached to it a complete and detailed
listing of all Used Motor Vehicles, in the form attached to Exhibit 4.
GMAC may, in its sole discretion, increase the frequency of such
reports and demand such a report at any time. The terms set forth in
the Monthly Certification Report shall be part and parcel of this Loan
Agreement.
5. RIGHTS AND REMEDIES OF GMAC. Upon the occurrence of any of the
following: (a) a default by Borrower in the payment, performance or
observance of any obligation or covenant under this Loan Agreement or
under any other agreement now or hereafter entered into with GMAC; (b)
the institution of a proceeding in bankruptcy, receivership or
insolvency by or against Borrower or its property; (c) if GMAC shall
deem itself insecure based on its knowledge of any event, occurrence,
circumstance or fact not directly caused by GMAC, which in the
reasonable judgment of GMAC will have a material adverse effect on the
Collateral, or on the collection by GMAC under any guaranty of the
obligations of Borrower hereunder or if any substantial portion of
Collateral is in danger of misuse, loss, seizure or confiscation; GMAC
may take immediate possession of Collateral without demand or further
notice and without legal process. In furtherance thereof, Borrower
shall, if GMAC so requests, assemble Collateral and make it available
to GMAC at a reasonable, convenient place designated by GMAC. GMAC
shall have the right, and Borrower hereby authorizes and empowers GMAC,
to enter upon the premises wherever Collateral may be and remove same.
In addition, GMAC shall have the right to exercise one or more of the
following remedies:
(a) institute proceedings to collect all or a portion of the
Credit Line Advances and to recover a judgment for the same
and to collect upon such judgment out of any property of the
Borrower wherever situated;
(b) to offset and apply any monies, credits or other proceeds
of property of Borrower that has or may come into possession
or under the control of GMAC against any amount owing by
Borrower to GMAC;
(c) sell or lease the Collateral, or any portion thereof,
after five days' written notice at public or private sale for
the account of the Borrower.
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Borrower agrees that the sale by GMAC of any property repossessed by
GMAC to the seller thereof, or to any person designated by such seller
at the invoice cost thereof to Borrower less any credits granted to
Borrower with respect thereto and reasonable costs of transportation
and reconditioning, shall be deemed to be a commercially reasonable
means of disposing of the same. Borrower further agrees that if GMAC
shall solicit bids from three or more other dealers in the type of
property repossessed by GMAC hereunder, any sale by GMAC of such
property in bulk or in parcels to the bidder submitting the highest
cash bid therefor also shall be deemed to be a commercially reasonable
means of disposing of the same. Notwithstanding the foregoing, it is
expressly understood that such means of disposal shall not be
exclusive, and that GMAC shall have the right to dispose of any
property repossessed hereunder by any commercially reasonable means.
GMAC's remedies hereunder are cumulative and may be enforced
successively or concurrently. Borrower shall pay all expenses and
reimburse GMAC for any expenditures, including reasonable attorney fees
and legal expenses, in connection with GMAC's exercise of any of its
rights and remedies under this Loan Agreement. In addition to the
rights specified herein, all the rights and remedies afforded GMAC by
applicable law shall apply.
6. TERMINATION. This Loan Agreement is effective until terminated upon
the earlier of any event described in subparagraph 5(a), (b), or (c) or
sixty (60) days after receipt of written notice of termination sent by
either party to the other. All rights and remedies of GMAC or duties
and obligations of Borrower extant upon termination of this Loan
Agreement shall continue in full force and effect until all obligations
are paid in full.
7. SUSPENSION. GMAC may, in its sole and absolute discretion and
judgment, increase, decrease, change, or suspend its obligation to make
Advances under the Line of Credit.
8. NOTICES. All notices, requests, and demands shall be in writing and
be given to or made upon the respective parties at the addresses set
forth in Section I of this Agreement, or to such other address as
either party shall designate for itself in writing to the other party.
Notice shall be deemed given when sent to the addressee and may include
hand delivery, overnight courier, certified mail, or electronic written
transmission by public or private means.
9. RIGHTS AND REMEDIES NOT WAIVED. No course of dealing between the
Borrower and GMAC or any failure or delay on the part of GMAC in
exercising any rights or remedies hereunder shall operate as a waiver
of any rights or remedies of GMAC and no single or partial exercise of
any rights or remedies hereunder shall operate as a waiver or preclude
the exercise of any other rights or remedies hereunder.
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10. COMPLETE AGREEMENT. Except as otherwise provided or referred to herein,
there are no other agreements or understandings, either oral or in
writing, between the parties affecting this Loan Agreement or relating
to any of the subject matters covered by this Loan Agreement. No
agreement between GMAC and Borrower which relates to matters covered
herein, and no change in, addition to (except the filling in of blank
lines), or erasure of any printed portion of this Loan Agreement will
be binding unless it is approved in a written agreement executed by a
duly authorized representative of each party.
11. BINDING EFFECT. This Loan Agreement shall be binding upon the
parties' successors and assigns provided, however, that Borrower shall
have absolutely no right of assignment absent prior written consent of
GMAC.
12. SEVERABILITY. Any provision hereof prohibited by law shall be
ineffective to the extent of such prohibitions without invalidating the
remaining provisions hereof.
13. GOVERNING LAW. This Loan Agreement shall be construed in accordance
with and governed by the laws of the State of Florida.
14. CAPTIONS. The captions of the various sections and paragraphs of this
Loan Agreement have been inserted only for the purposes of convenience;
such captions are not a part of this Loan agreement and shall not be
deemed in any manner to modify, explain, enlarge or restrict any of the
provisions of this Loan Agreement.
IN WITNESS WHEREOF, each of the parties has caused this Loan Agreement to be
executed by its duly authorized representative effective the date first above
written.
FIRST TEAM INFINITI, LTD., GENERAL MOTORS ACCEPTANCE
a Florida limited partnership CORPORATION, a New York
("Borrower") corporation ("GMAC")
By: First Team Management, Inc., By:_________________________________
a Florida corporation
Its:________________________________
By:_____________________
Print Name:_____________
As:_____________________
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STATE OF ___________ )
COUNTY OF _________ )
The foregoing instrument was acknowledged before me this ____ day of
______________, 1996*, by _____________________________, as ______________ of
FIRST TEAM MANAGEMENT, INC., a Florida corporation, the General Partner of FIRST
TEAM INFINITI, LTD., a Florida limited partnership, on behalf of the corporation
and partnership. He [is personally known to me] [has produced
___________________________ as identification].
_________________________________
Notary Public
Print name:______________________
My commission
expires:
STATE OF ___________ )
COUNTY OF _________ )
The foregoing instrument was acknowledged before me this ____ day of
______________, 1996*, by ________________________, as ___________________ of
GENERAL MOTORS ACCEPTANCE CORPORATION, a New York corporation, on behalf of the
corporation. [He] [She] [is personally known to me] [has produced
___________________________ as identification].
_________________________________
Notary Public
Print name:______________________
My commission
expires:
*(Reexecution Date)
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EXHIBIT 1(b) to Used
Vehicle Wholesale Borrowing
Base Credit Line Loan
Agreement Between GMAC and
_________ ("Borrower")
dated ________, 1995 (the
"Loan Agreement")
To: Attention: ___________________, Field Support Office Manager
General Motors Acceptance Corporation
REQUEST FOR CREDIT LINE ADVANCE
Pursuant to Paragraph 1(b) of the Loan Agreement, Borrower hereby requests an
Advance form GMAC to Borrower in the principal amount of $________________.
In connection with such Advance, the undersigned hereby certifies that:
1. Borrower's available Collateral Formula Amount, calculated pursuant to
subparagraph 1(g) of the Loan Agreement (i.e., Collateral Formula
Amount less outstanding Credit Line Advances), as of the date hereof is
$__________.
2. The amount of the Advance requested hereunder does not exceed the
amount of credit available pursuant to paragraph 1(c) of the Loan
Agreement.
3. No default under the Loan Agreement has occurred.
4. The proceeds of the Advance to Borrower requested hereby shall be
(INITIAL one):
______ delivered to Borrower in the form of a check drawn on
GMAC.
______ wire-transferred to Borrower's depository bank
account number _________________, located at the
following financial institution:
____________________ (Name)
____________________ (Address)
____________________
ABA Routing No. ________________
Certified as of __________________________.
________________________________________
Borrower
Preparer's Name_____________________
Preparer's Title______________________
Preparer's Signature__________________
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As of _______________, 1995 EXHIBIT 4 to Used Vehicle Wholesale
Borrowing Base Credit Line Loan
Agreement Between GMAC and
_____________________ ("Borrower")
dated ___________, 1995 (the "Loan
Agreement")
To: Attention:________________________, Field Support Office Manager
General Motors Acceptance Corporation
MONTHLY CERTIFICATION REPORT
Used Motor Vehicles [see Paargraph. 1(g)] .................. $___________ x __% = $_________________
Outstanding Credit Line Advances (subtract) [see Paragraph. 1(b)]......................[$___________]
Available Collateral Formula Amount [see Paragraph. 1(c)]....................................$______
The undersigned hereby certifies that as of the date hereof, the above
information and the attached list of Vehicles consisting of ___ pages is true
and correct and that there exists no default under the Loan Agreement.
The Monthly Certification Report of Borrower shall be subject to GMAC's
approval. No failure by GMAC to provide notice of approval or notice of
disapproval shall limit or constitute a waiver of any of the rights or remedies
of GMAC hereunder or under any other loan document. Notwithstanding anything
herein to the contrary and notwithstanding that GMAC may have previously
approved any Used Motor Vehicle for inclusion in the Collateral Formula Amount
at a specified value, GMAC may, at any time and from time to time, reevaluate
the value of any Used Motor Vehicle included in the Collateral Formula Amount.
Incident to any such reevaluation, the Borrower shall promptly provide to GMAC
any materials GMAC may reasonably require. GMAC, in its sole and absolute
discretion, may determine as a result of any such revaluation to reduce the
amount which any Used Motor Vehicle contributes to the Collateral Formula Amount
or to exclude such amount of any Used Motor Vehicle entirely, which
determination shall be conclusive and binding in the absence of manifest error.
If GMAC so determines that the Collateral Formula Amount of Borrower is to be
reduced, GMAC shall give written notice thereof to the Borrower stating the
amount of the reduction, the Used Motor Vehicle affected and the nature of the
action taken by GMAC, and the reduction shall be effective upon GMAC's issuance
of that notice.
_________________________________
Borrower
Preparer's Name_____________________
Preparer's Title____________________
Preparer's Signature________________
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